A recent opinion piece by Dana Hess for South Dakota Searchlight took aim at Jon Hansens statement that if elected as South Dakotas next governor he would seek to end corporate welfare. Hansen, currently holding South Dakotas third highest elected office, as speaker of the House of Representatives, along with speaker Pro-Tem Karla Lems, announced in April their intention to run for governor and lieutenant governor in 2026.
In a follow up interview, Hansen gave the example of state corporate welfare as the poor investment the state made when it gave Tru Shrimp a $6.5 million loan in 2019. In the six years since receiving the state loan, Tru Shrimp has yet to build or start anything. Hansen categorized the loan as risky business, and said they are wasting our taxpayer dollars to do it. He continued, Its the sort of stuff that we want to say no more to. Lets get back to the free market, low tax and low regulation.
Hess thinks ending government handouts would be a mistake. He bases that on the idea that if we dont, they (other states) will and we will lose out. He cites recent examples of a $3.4 million state grant for Big Stone Energy and a $2.6M grant for the expansion of Bel Brands. Does he really think a South Dakota utility and an existing successful industry will leave if we dont give them free money? Remember, the state has no way to make money, only take money. The money the state hands out comes from you and me, and South Dakota businesses. Savvy business owners understand this too, and prefer low tax and regulatory freedom, over courting elusive handouts from a governor.
In addition to unnecessary handouts, the risks are more than just state tax payer dollars. When the state endorses a project and invests, local governments and local people take that as a signal of confidence and make investments as well. The risks get multiplied and people and communities get hurt. Tru Shrimp is an example of that kind of multiplied damage.
Since its inception in 1987, the Governors Office of Economic Development (GOED) has managed all of these loans and grants. By its name, anyone can see the problem. The governor picks the people who run the office and effectively controls who gets taxpayer money, how much they get and whether its a loan or a grant. Thats too much power in the hands of one person. Recent attempts by the legislature to roll back that power have been stopped, because sitting governors like the influence and power. As such, it is courageous for Hansen to say, if elected, he will stop it, rather than look forward to doling it out his way.
I served in the Legislature with Jon Hansen, know him to be a man of his word, and I agree. It is time to stop corporate welfare at South Dakotans expense.
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